In this age of an almost overwhelming profusion of criminal activity, it may seem surprising to discover that not all crimes and criminals are treated in the same manner. In fact, on closer inspection, research has suggested that there is a tendency for certain crimes and criminals to be positively overlooked, typically these being crimes of the powerful. (Ditton, 1977; Box, 1983; Chambliss, 1989; in Muncie, 1996)
Before embarking on the differential responses to the crimes of the powerful, it is prudent to clarify exactly what is meant by powerful and the nature of crimes they commit. Powerful is defined as being influential, dominant and authoritative. Studies have shown that the types of crimes committed by such individuals are often in the affluent, private sphere of business and commerce, with a stable family background who consistently possess a good character. (Hughes, Langan, 1996)
Studies by Sutherland (1949/67, cited in Hughes et al, 1996 p.244) described the types of crimes the powerful commit as, “…violations of law by persons in the upper socio-economic class are, for convenience called ‘white collar’ crimes” There are many different kinds of white collar or “corporation” crime, ranging from fraud, embezzlement, insider trading, to health and safety, environment crime, tax evasion, and crimes against the consumer.
In considering the existence of corporate crimes and acknowledging that to each victim there is an individual cost, how can we explain the lack of reporting, detection and punishment?
In Henry & Milovanovic’s “Prism of Crime” (1996, in Muncie, 1996 p.21), crimes of the powerful tend to have low visibility, have an indirect influence on society and elicit a conflicting response from the public. Crimes of the less powerful, by contrast, have a high visibility, a direct influence on individuals and provoke a response of agreement from the public.
The myth that all crimes were committed by members of the lower socio-economic classes was expounded by Sutherland (1949, in Muncie, 1996) who showed that more significantly, members of the higher socio-economic classes were likely to be involved in crimes notably worth much more than all robberies, acts of larceny and thefts put together. In 1965, the FBI approximated that $284 million were lost in burglaries, compared to the staggering $9 billion the most affluent percentage of American people defrauded from the tax office the same year. (Pearce, 1976, in Muncie, 1996)
Society’s attitude towards “ordinary” crimes as opposed to “corporate” crimes are often polarised for the following reasons. Ordinary crimes such as burglary, vandalism, rape and murder are often committed by members of the lower socio economic classes and typically have an easily identifiable perpetrator and victim. (Sutherland, 1949/67 in Hughes et al, 1996). These “street” crimes are highly personalised, close to home and are often accompanied by high media coverage – “If it bleeds it leads”. The shocking nature of these crimes grab our attention and we feel a personal hostility to the perpetrators compounded with a sense of empathy for the victims. (Nelken, 1997, in Hughes et al, 1996)
It is easy to understand who has been mugged, raped or murdered and these days street crime even has a face, “..society’s perception of the perpetrators of street crime are conceptualised as a poor, young man belonging to an ethnic minority”. (Reiman, 1998)
The conceptualised corporate criminal is more likely to be perceived as a trustworthy, legitimate role model for society and whilst society does see corporate crime to be deemed a crime, it is not seen to be as important as street crime. Moreover, the nature of this type of crime can also lend itself to complexity and a lack of understanding. With its possible global connections, corporate crime can often appear rather remote and distanced from society’s daily occurrences. (Hughes, et al 1996)
Corporate crimes, more often committed by older, affluent, white members of the higher socio economic classes, are by the very nature of this crime, very difficult to establish from a faceless corporation. Who is to blame and who exactly is the victim? Corporate crime does not have the immediacy of blaring police sirens, the frantic hunt for a killer; it lacks the blood and violence associated with street crimes. (Levi, 1999, in Hughes, et al 1996) This lack of shock value could perhaps contribute to a similar lack of media coverage. Nelken observes that ” There is a great ambivalence surrounding the nature of white collar and corporation crime, not only does the state deal differently with white collar criminals and ordinary criminals, but there is also a marked difference in the public attitudes towards them.” (Nelken, 1997, cited in Hughes, et al 1996. p.241)
There are many reasons why this type of crime often goes unreported. Clearly the media cannot report on all crime, therefore reporters tend to choose the most newsworthy stories. Studies have shown (Bailey & Hale, 1998; Surette, 1998) that violent crimes are typically over represented and exaggerated in the media. Young observed that “newspapers select events which are atypical, present them in a stereotypical fashion and contrast them against a backcloth of normality which is overtypical.” (Young, 1974, cited in Muncie, 1996. p.45) Indeed, in the highly publicised case of the ‘ordinary crimes’ of Fred West, the press, calling for even more publicity to an already saturated story, persuaded the police to be photographed carrying out an empty box, the public assuming it contained the remains of his victims. (Hughes, et al 1996)
In contrast, “white collar crimes” receive a much lower public profile. Corporate crimes do not seem to fit society’s stereotype of a common criminal. Indeed, many large corporations hold a positive and trustworthy image, for example – Bill Gates of Microsoft, has had to respond to charges of antitrust violations.
There would also appear to be a general reluctance on the part of “whistle-blowers” to report corporate crimes. One reason could be their subsequent treatment afterwards, loss of face or job, coupled with possible court repercussions. The European Commission’s former chief accountant Marta Andreasen, (see www.bbc.co.uk) fired two years after she was suspended for disloyalty and breach of trust. claimed there were holes in the EU budget system. It would appear that the daunting task of standing against a very powerful corporation or leader is sometimes enough for the problem to appear less crucial.
Corporate crimes, by their nature are highly specialised, involving legal jargon and typically too complex for the general public to understand. As they are executed
by members of the upper socio classes, they often involve high level intelligence, skill and knowledge. Major fraud, embezzlement etc can involve many individuals, have links to other corporations, use global connections and take place over many years. (Hughes, et al 1996)
In addition to the under representation in the media, there appears to be a low visibility even within the private domain of the corporation itself, permitting these crimes to remain undetected. The very complexity of fraud, embezzlement and insider trading lends itself to confusion and disinterest. In fact, many employees involved in the Guinness attempt to take over Distillers did not realise that fraudulent activity was taking place, leaving the general public none the wiser.. (Hughes, et al 1996)
These crimes are typically hidden in the private sphere and require expert investigators to expose these frauds. They are not subject to the public eye and therefore do not have the familiar day to day interest that street crimes do.
A further reason for corporate crimes to remain undetected could be a possible government involvement. The 1993 “Arms for Iraq” incident was only disclosed after a long awaited public inquiry, (see www.trytolive.com) The publication of the report by High Court judge Sir Richard Scott, revealed that Margaret Thatcher’s government in the 1980s, followed by John Major’s in the 1990s, covertly approved arms sales to Saddam Hussein. The report revealed that the origins of the scandal are in the 1980s arms-export drive by Thatcher. Mark Thatcher earned himself an estimated $160 million in commissions as an unofficial salesman in the process, including up to $40 million from a single deal with Saudi Arabia. Suffice to say that Major’s Conservative government survived the February 26 House of Commons debate on Scott by a single vote, thereby escaping punishment.
Disappearance is another means of evading justice. In May 1993, Asil Nadir did just that after some 0 million disappeared from the Polly Peck company. Perhaps he had followed Robert Maxwell’s cue who ‘died’ under suspicious circumstances in 1991, after it was revealed that he had defrauded 0 million from his employees’ pensions. (Muncie, 1996) The very apathy that surrounds corporate crime is also to blame, compounded with a general lack of policing for corporate violations. In 1985 only 538 from a force of 120,00 were designated to the Fraud Squad, reflecting societies perception of the severity of corporate crime. (Hughes, et al 1996)
Once caught, perpetrators typically receive minimal sentences for their crimes. In 1993, the Australian Oil Refinery pipeline spilled 10 tonnes of oil into Botany Bay for the fifth time in seven years. They were fined $300. (see www.aic.gov.au) There is also a difficulty in establishing who is to blame. Both the tragedies of the Herald of Free Enterprise and the Marchioness disasters had prosecutions brought by authorities and the families but no charges were imposed and the only liable perpetrators were deemed to be the cabin crews at the time (lower socio-economic class) and not the owners (higher socio-economic class). (Hughes, et al 1996)
Society appears to accept that at the very heart of successful businesses is the “buy it cheap, sell it dear” culture. With this is mind, the general consumer is defrauded every time he makes a purchase but this is not seen as criminal, simply good marketing. This accepted culture, from the outset, lends itself immediately to transactions of a deceitful and fraudulent nature. For society to then understand that specific actions, when deemed a violation of certain laws, are to be deemed illegal must certainly cause confusion.
In point of fact, not all corporate crimes come under the criminal justice jurisdiction. There is an emphasis for the various regulatory agencies to prove malign intent’ (mens rea) and this has shown to be difficult, particularly when dealing with corporations and not individuals. As a large number of corporate crimes are deemed to be regulatory offences, they are not prone to the same methods of prosecution as are ordinary crimes. (Hughes, et al 1996) Very often, these corporations have self regulating bodies for which, research has shown, inspectors for these bodies regard their duties as advisory rather than policing (Hutter, 1998, in Hughes, et al 1996) which can lead to an ethos of complacency at the very least. These corporations fiercely appose outside influence and there is a reluctance on the part of the agencies to interfere with private business practice. (Clarke, 1990a, in Hughes, et al 1996)
The problem of global policing and prosecuting corporate crimes is finally being addressed, with George W Bush (see www.rtmark.com) setting in motion a series of new statutes aimed to view these crimes in a similar way as ordinary crimes, in that corporations take on a human form. “While some experts dispute whether corporations can actually become human beings, most agree that punishing corporations for the crimes they commit will at the very least have a positive effect on the market.” (Bush, 2000) Corporations can then be prosecuted and subject to the same punishments within the criminal justice system as would an individual.
Corporations would be hit where it hurt them most, financially. Bush has outlined a two tier system for misdemeanours and felonies. Punishment would range from short or long term share confiscation, dividends to be used to provide health care to victims; to a “negligent homicide” charge in which shareholders are subject to a prison term, the length of which is dependant on the amount of shares they hold and the severity of the crime. Bush has recognised that leaving corporations subject to regulatory agencies is not ideal. “We must remove the burden for controlling corporations from big government, from regulation and fines, and place it squarely on the judiciary,” (Bush, 2000) Thus bringing corporate crimes full circle and in line with crimes of an ordinary nature.
It is clear that the human cost of corporate crime is very real to the individual, whether it be financial loss, environmental damage, injury or loss of human life. The need for recompense and the recognition of a moral responsibility needs to be expected by society, not ‘dumbed down’ because of the criminal being a corporation and not an individual. The act is no less personal and no less criminal!
Andreasen, M. 2002, sourced in http://news.bbc.co.uk/1/hi/world/europe/3742148.stm accessed on 20/03/05
Bailey, F & Hale, D. 1998. Popular Crime Culture and Justice. Belmont CA, West/Wadsworth
Bush, G W,. 2000. sourced in http://www.rtmark.com/bushprcorpcrime.html accessed on 21.03.05
Box, S. 1983. in Muncie, J. 1996. “The Construction and Deconstruction of Crime” p. 9-44 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Chambliss, WJ. 1989. ibid
Ditton, J. 1997. ibid
Clarke, 1990a, in Hughes, G. with Langan, M. 1996. “Good or Bad Business? : Exploring Corporate and Organised Crime” p.240-273 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Hughes, G. with Langan, M. 1996. “Good or Bad Business? : Exploring Corporate
and Organised Crime” p.240-273 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Hutter, B. 1998 ibid
Levi, M. 1999 ibid
Muncie, J. 1996. “The Construction and Deconstruction of Crime” p. 9-44 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Nelken, D. 1997 in Hughes, G. with Langan, M. 1996. “Good or Bad Business? : Exploring Corporate and Organised Crime” p.240-273 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Reiman, J. 1998. The Rich Get Richer and The Poor Get Prison. Boston Press
Surette, R. 1998. Media Crime and Criminal Justice: Image and Realities. Belmont CA, West/Wadsworth
Sutherland, E. 1949, in Muncie, J. 1996. “The Construction and Deconstruction of Crime” p. 9-44 in The Problem of Crime edited by J. Muncie and E. Mc Laughlin. Sage Publications
Young, J. 1992. ibid
Australian Institute of Criminology http://www.aic.gov.au accessed 18.03.05
Arms to Iraq http://www.trytolive.com/cor332.htm accessed 19.03.05